Home Money As Woodsmith mine is mothballed, job losses will have seismic impact on Whitby community

As Woodsmith mine is mothballed, job losses will have seismic impact on Whitby community

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As Woodsmith mine is mothballed, job losses will have seismic impact on Whitby community

The site of Britain’s largest mining development is a hive of activity. Builders and engineers are working to drill twin wells almost a mile deep at the Woodsmith fertilizer project, near the picturesque seaside town of Whitby.

Beneath the North York Moors National Park, another team is racing to drill a 23-mile tunnel that will connect Woodsmith to Teesside.

Woodsmith was heralded as a transformative project. It was hoped that it could produce so much fertilizer that its economic value could reach 4 percent of Britain’s entire national income.

It hasn’t turned out that way. The hubbub is expected to end within months after the mine’s owner, Anglo American, pledged to slash investment. Locals believe the measure is “a disaster.”

The Mail on Sunday can reveal massive job cuts at Woodsmith have been kicked off. Staff at a major contractor on the site were told last week that more than 300 people would be made redundant before the end of the year, a source in Whitby said.

In a hole: North York Moors (above) and in the depths of Woodsmith Mine (above)

In a hole: North York Moors (above) and in the depths of Woodsmith Mine (above)

Up to 80 per cent of the site’s 1,400 contractors could be affected in total, the Mail revealed last month.

This is deeply unhelpful to the Conservatives, who are desperate to hold on to seats in red-walled areas such as nearby Teesside, and to Rishi Sunak, whose constituency of Richmond in North Yorkshire (to be known as Richmond and Northallerton from the polls) general elections) is only a few kilometers away.

Woodsmith’s slowdown has alarmed Conservatives defending marginal seats in the surrounding area in next month’s election.

Middlesbrough South and East Cleveland defender Sir Simon Clarke has described the slowdown as a “very unpleasant surprise”.

And Jacob Young, the Conservative candidate for Redcar, who won his seat in 2019 and has a slim majority of 3,500, urged Anglo American to reverse its decision. He said: “If contractors are demobilized and staff laid off, the project may never restart.”

Anglo American is due to make a public announcement on Woodsmith’s future later this month. However, the company told The Mail on Sunday it would “gradually” halve its workforce to 160 people over the next year.

The slowdown will halt development, putting the partially completed mine into hibernation. It will leave a skeleton staff to help with basic maintenance.

The local economy is braced for the impact of losing the business provided by the mine’s contractors and the delay in creating permanent jobs at Woodsmith.

It brings back bad memories for many.

People here have seen other once-thriving industries, such as steel, decline, leaving thousands of people with nowhere to go.

The turmoil at Woodsmith is part of a strategy drawn up last month by Anglo chief executive Duncan Wanblad to help fend off a £39bn takeover attempt by rival BHP.

Wanblad won and the deal was abandoned. Woodsmith, however, was collateral damage.

Anglo may not make a final decision on the future of the mine for a couple of years, but the omens are not good. It’s a big setback for a project that began with high hopes eight years ago under the original developer, a now-defunct company called Sirius.

Local concern is such that North Yorkshire County Council is to set up a task force.

It will involve others, including Teesside Mayor Ben Houchen, to help subcontractors find alternative jobs. Carl Les, leader of Conservative-controlled North Yorkshire county council, said: “The only positive thing is that the Teesside area is quite prosperous at the moment and there are lots of other jobs going on which can provide opportunities for those affected by the slow -down.’

He told them that areas of the wider local economy that benefit from mine contractors range from hoteliers and house renters to cafe, pub and retail owners.

He said the project has helped expand the local economy’s reliance on tourism. Anglo is looking for an investment partner – possibly in the form of another miner or a sovereign wealth fund – with whom to share the huge cost of the project. John Cook, chairman of the Yorkshire Coast Minerals Association, a group of farmers who lease their land to the mine, said Woodsmith would be a “decent prospect” for a partner because its fertilizer reserves could be exploited for 100 years.

He said: ‘When Anglo American took over the mine there was optimism locally. It is a highly valued company and was considered a safe workforce.’

Cook was one of thousands of small investors who put their faith and money in Sirius Minerals back in 2015. He said: “Like a lot of people, I put a little money into it as a small investor and felt a duty to back something that “Could to be so important to this area that I wanted to be a part of it.

He and around 85,000 other individual investors, many of whom were local, lost thousands of pounds or even their life savings when Sirius’ share price plummeted. He was rescued by Anglo in a cut-price £400m deal.

The grand plans revealed by Sirius captured the imagination of a region brutalized by the loss of thousands of steel jobs on neighboring Teesside.

The company was to build two 4,900-foot shafts to reach a 230-foot mineral vein, which would make it the deepest mine in Europe.

Bad taste: Sackys Cafe owner Steve Swales to be affected

Bad taste: Sackys Cafe owner Steve Swales to be affected

The polyhalite then had to be transported 37 kilometers through a tunnel to the company’s processing plant on Teesside on a giant conveyor belt.

The project was originally due to be completed in 2021, but the most recent completion estimates, before the slowdown was announced, were 2027. The timeline is now unknown.

The scale of job losses will have a seismic impact on Whitby.

Steve Swales, 50, owner of Sackys Café on the harbour, said: ‘I know lads who left good jobs to go to work in the mine.

‘Now we hear that 80 percent could lose their jobs.

“Make no mistake, many job losses at the mine will have a big effect on everything in this town.”

Frank Iddon, 66, is chief operating officer of the Whitby Endeavor, a museum ship and restaurant dedicated to the legacy of explorer Captain James Cook.

“It’s another blow the area could avoid, especially after the loss of all the steel jobs on Teesside,” he said.

Peter Donichey, 70, was selling joke books to tourists at the port but felt the situation at Woodsmith mine was no laughing matter. He said: ‘I actually worked for Anglo American in the 1980s on a gold mine in South Africa. It was a huge operation and I know how much money that company is worth because I have seen it firsthand.

Tom McCulley, chief executive of Anglo American’s crop nutrients division, said: “We are undertaking a full assessment process of all workflows to meet the new business plan.”

  • Additional reporting by Kevin Donald and Francesca Washtell

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